San Antonio Express-News
April 3, 2006

Coexecutors
and
Gift Deed

copyright 2006, Paul Premack

Right now, your Wills name individual Executors who are different people. If you die first, the son you have named will handle your estate alone. If your husband dies first, the son that he selected will handle his estate alone. If you both die at the same time, there will be two probates, each being handled by the different sons you selected – not as Coexecutors, but each individually having responsibility for the half community property interest owned by you and owned by your husband respectively.

You could abandon that setup and decide to name Coexecutors (two people who are both in charge of each estate at the same time). If so, they would both be able to handle the entirety of both estates. However, naming Coexecutors can provide an opening for conflict, because Coexecutors are not bound by law to act unanimously.

What if funds are limited, and one Coexecutor feels it is appropriate to pay off the MasterCard while the other one wants to use the money to pay off the Visa? They might argue over money and how it should be allocated. Both Coexecutors could even hire separate attorneys which would double the cost of administration.

Coexecutors must act jointly only when dealing with the sale of land. But if the Coexecutors are like-minded they can choose to coordinate all of their efforts. Conflict is not a given just because you name Coexecutors. When they get along and work together, Coexecutors share the burden and lighten each other’s load. So it depends on the character of the people and their relationship whether naming Coexecutors is a wise or an unwise tactic.

Dear Mr. Premack: An elderly woman grants legal Durable Power of Attorney to her son. She later signs a Gift Deed with Life Estate clause transferring title of real estate upon her death to the same son. Is the Gift Deed legal since it was (a) signed only by her and not by her Power of Attorney, and (b) gifted to the person who is also agent in her Power of Attorney? I was told that either event makes the Gift Deed invalid. – PJS

When anyone signs a Durable Power of Attorney as principal, that person retains full and unrestricted right to handle any and all business and financial matters for herself. The agent may act on behalf of the principal, but does not supplant the principal.

The agent is a fiduciary for the principal, so the first question the agent must ask before taking any action is "am I authorized by the power of attorney to do this action?" and the second questions is "does this benefit the principal?" The agent cannot legally act beyond the scope of his authorization, and he cannot legally act in a way that harms the principal.

In your letter, you say that the elder woman signed the gift deed herself. It was her choice, her signature and her act. Her son, although he is agent, was not taking part in the transaction except as recipient of the property upon his mother’s death. There is nothing about the deed that violates a fiduciary duty, because the elderly woman is acting on her own, not through her agent. Thus under Texas law this transaction is entirely valid.